Question

For the following questions label each statement as True or False and explain why you choose your answer.

1. True or False   Economics is a business discipline that studies how firms can maximize profits.

2. True or False When the price of an item increases it means that the supply of the item has fallen

Answer 1

1.FALSE

Economics is a" business discipline for that studies how firms can maximise profits". This statement was FALSE because  

It is the study of decision making , a study of how people use resources, how they respond to incentives, or how to make decisions.

  

2.FALSE

an increase in price of item will result into an increase in supply, as producer will see an opportunity to make a profit. if the marginal cost of producing a product is lower than the price offered by consumers, a supplier will increase production, which increases supply. a price increase usually results in an increase in output from existing suppliers and often attracts new suppliers to the market if they feel their cost of supply is lower than the market price.